Disability benefits ‘could be taxed’ in order to fund higher payments for the poorest claimants, it has been reported today.
Under proposals being considered by the Work and Pensions Secretary, Iain Duncan Smith MP, higher-income disabled people in receipt of Personal Independence Payments (PIP) would subsidise increased payments for the poorest claimants, through the introduction of a new tax on their benefit.
PIP, like its predecessor, can be claimed regardless of a person’s employment status or income. PIP claimants can currently receive anything between £21.55 and £138.05 each week, dependent upon a claimant’s disability and care needs.
PIP was rolled out in April 2013 and is replacing Disability Living Allowance (PIP) for all disabled people.
A senior government source told the Times on Sunday: “It cannot be right that those on the lowest incomes get the same disability benefits as those who are millionaires.
“It would be fair to tax the benefits so those on higher incomes, many of whom don’t need the money nearly as much, would pay at the same rate as income tax.”
Iain Duncan Smith is said to be interested in the proposal but no formal announcement has yet been made.
Find out more: The Independent.